oh dear: Morgan Stanley fears UK sovereign debt crisis in 2010

[AtW]

Morgan Stanley fears UK sovereign debt crisis in 2010

Britain risks becoming the first country in the G10 bloc of major economies to risk capital flight and a full-blown debt crisis over coming months, according to a client note by Morgan Stanley.

The US investment bank said there is a danger Britain’s toxic mix of problems will come to a head as soon as next year, triggered by fears that Westminster may prove unable to restore fiscal credibility.

“Growing fears over a hung parliament would likely weigh on both the currency and gilt yields as it would represent something of a leap into the unknown, and would increase the probability that some of the rating agencies remove the UK's AAA status,” said the report, written by the bank’s European investment team of Ronan Carr, Teun Draaisma, and Graham Secker.

From Torygraph.

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Was just coding VAT logic for new system - decided to make it very flexible as I expect it will go up more than once next year

[TimberWolf]

Are Euro's going to be safer than Sterling?

[HairyArsedBloke]

The UK may be the first G10 to have problems, but we will have euro members Greece and Ireland to entertain us all before that happens.

[AtW]

Are Euro's going to be safer than Sterling?

Here is what "investors" think.

1.5 to 1.1 (nearly -30%) in just 2 years

[AtW]

we will have euro members Greece and Ireland to entertain us all before that happens.

Quiet.

Their state currency will plunge and this will effectively prevent them from borrowing money from their central bank to repay state debt as every time they do so their currency will plunge even futher

[HairyArsedBloke]

Quiet.

Their state currency will plunge and this will effectively prevent them from borrowing money from their central bank to repay state debt as every time they do so their currency will plunge even futher

Alexi, both are euro members and have been since, mmmmmmmmm, the thing started in 1995.

Do keep up.

[suityou01]

Morgan Stanley fears UK sovereign debt crisis in 2010

Britain risks becoming the first country in the G10 bloc of major economies to risk capital flight and a full-blown debt crisis over coming months, according to a client note by Morgan Stanley.

Good quality doom. Nice one.

Apparently TARP was created a few months before the credit crunch started. Who the flip do these people think they are?

[TimberWolf]

To be honest I've been thinking more in terms of currency collapse and massive inflation than a "further 10pc in trade-weighted terms" drop of Sterling, so it seems quite an optimistic prediction.

[AtW]

Alexi, both are euro members and have been since, mmmmmmmmm, the thing started in 1995.

Do keep up.

That's exactly the point (you did not get my sarcasm) - their currency won't go down big time because it is shared currency in Europe, just like California's problems don't hit dollar that much on their own.

UK on the other hand is on it's own thanks to the foolish and very expensive decision to stay out of euro which is now a reserve currency with sterling being relegated big time.

[suityou01]

That's exactly the point (you did not get my sarcasm) - their currency won't go down big time because it is shared currency in Europe, just like California's problems don't hit dollar that much on their own.

UK on the other hand is on it's own thanks to the foolish and very expensive decision to stay out of euro which is now a reserve currency with sterling being relegated big time.

The dollar and pound are screwed. This is part of the plan. Accept it and make contingency plans.